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Friday, 01 February, 2019, 17 : 53 PM [IST]

BUDGET: INDUSTRY REACTS

The travel & tourism, aviation and hospitality industries are of opinion that the Interim Budget presented by Interim Finance Minister Piyush Goyal today will have a long-term impact on the business environment in the country. Infrastructure development at the centerstage and the usage of mobile data coupled with UDAN scheme will have a direct impact on travel behaviour. Moreover, the tax relaxation on annual income of Rs 5 lakh would fuel travel with additional disposable income. TravelBiz Monitor presents industry feedback.

Peter Kerkar, Group CEO, Cox & Kings
The move by the government to increase the tax exemptions will lead to additional savings thereby leading to more discretionary spends and travel and tourism can be one of the beneficiaries The overall emphasis on improving rural connectivity with an outlay of Rs 190 billion will lead to easier access to key tourism destinations which are located in rural and semi-rural areas. Furthermore, the government’s continued emphasis on the North East by allocating additional resources to the region will dramatically improve the connectivity and give a boost to tourism. 

Dr. Ankur Bhatia, Executive Director Bird Group & Member of CII’s Core Committee on Aviation
We congratulate the government for presenting a forward-looking and progressive interim budget. This budget while announcing financial sops for MSME’s, farm and health sectors that form the backbone of the economy and tax relief for the middle class, also sufficiently prioritized infrastructure for railways and airports by allocating hefty investment to add fillip to ongoing progress. For airlines, the business has grown exponentially in the last year as UDAN Yojana has made travel possible for anybody and everybody. This has put an unexpected burden on airports severely crowding them. There is an urgent need to upscale existing airports and introduce the stipulated 100-mark operational airports soon, to cater to an ever-increasing demand. We now await the implementation of the promises made.

Mahesh Iyer, ED and CEO, Thomas Cook (India) Limited
While the Interim Union Budget 2019 has seen no direct mention of the travel and tourism sector, focus on tax breaks for the Middle Class (including doubling of income-tax exemption to Rs 5 Lakhs, raising of the threshold on bank fixed deposit interest to Rs 40, 000, etc.), will result in increased disposable income and a cascading boost to consumption- offering the sector an opportunity for increased travel & tourism spends.

Impetus to associated industries including the Indian Railways with a budget outlay of Rs. 1, 48, 650 cr., a specific focus on untapped sister states Meghalaya and Tripura, along with 19,000 cr. Allocation to roadways under PMGSY (Pradhan Mantri Gram Sadak Yojna) will see enhanced access and connectivity bringing newer tourism destinations on the radar, especially in Tier II and III regions.

Shikhar Aggarwal, JMD, BLS International
The interim budget appears balanced and forward looking. The focus on creating digital infrastructure in villages and expanding common service centres to digitally deliver services to citizens is a very positive move. My own company is amongst the pioneers in this area and we know how it can help  increase efficiencies for Citizens as well as for Government officials, while also creating employment in the local eco-system. Artificial Intelligence and machine learning are becoming increasingly important for business and  setting up of national centre for artificial intelligence along with the development of national AI portal is very welcome. It will further improve the ability to handle large data efficiently and with greater data security.


Ajay Singh, Chairman and Managing Director, SpiceJet
This has been a fabulous budget and I compliment my good friend and Finance Minister Piyush Goyal for a fantastic job. The FM has managed to do something for a large cross section of society - the middle class, the farmers, workers in the unorganised sector. At the same time, he has ensured that fiscal deficit remains at 3.4%. This is a people's budget that will help the economy and also lays down a vision for the next 10 years. This could well be a game changer budget in this election year. I feel that the government with this budget has certainly injected a lot of josh without losing its hosh!"


Rakshit Desai, Managing Director, FCM Travel Solutions - Indian Subsidiary of Flight Centre Travel Group, Australia
India is poised to become a $5 trillion economy in the next five years and is aspiring to become a $10 trillion economy in the next 8 years thereafter. The interim budget announced promising initiatives that will definitely augur well for the Indian Travel & Tourism industry. Initiatives such as UDAAN, Eastern Peripheral Highway and several other measures will boost not just domestic travel but also augment inbound tourism. For example, increased connectivity in the North-Eastern region of India, through rail, road and air (owing to projects such as UDAAN and Bogibeel Bridge) and further proposed allocation of INR 58,166 crore will provide much needed impetus to travel and tourism in the region.

Additionally, the fact that domestic passenger traffic has doubled during the last five years shows that there is phenomenal growth expected in the travel industry. On the whole, the interim budget is promising for the travel industry, complemented by further tax rebate for the middle income group – more savings, more travel!

Naveen Kundu, MD, Mercury, A Luxury Initiative of Ebix Cash
Though Travel & Tourism sector were not mentioned during the annual budget, but the move to increase tax exemptions will lead to an increase in the spending income of Indian middle class. It is a positive step which can result in an increase in domestic and inbound travel. By prioritizing the need to improve rural connectivity and allocating additional budget to North East region means many more destinations will now be accessible to the traveler. Hence, budget 2019 aims towards improved connectivity through roads, rail and air travel.


Ritesh Agarwal, Founder & Group CEO, OYO Hotels & Homes 
This is the Budget for a New India. The honorable interim FM has meticulously balanced priorities of various sections of our society and delivered on his government’s vision of ‘Sabka Saath, Sabka Vikas’. This Budget makes a strong promise to the people to India, which I hope will be backed by an equally strong delivery, especially in the areas of job creation and addressing the skill-talent gap. The announced tax breaks, together with low average inflation, are likely to spur domestic demand and spending, and inject liquidity in the market. This is great news for sectors such as hospitality and travel. The announcements on bridging the digital divide and improving efficiency through technology are also welcome. I am excited about India’s Vision 2030 and believe that it will empower more young entrepreneurs to set off on their entrepreneurial journeys.


Neelu Singh, CEO & Director, Ezeego1
The interim budget highlights the government’s proposition to further enhance the infrastructure of roads, railways, airports, urban transport and inland waterways which will bring new and unexplored destinations on the tourists map as well as enhance the overall travel experience. A vision for a Clean India with enhanced regional connectivity will be a great leap for Indian states promoting existing as well as new tourism products.

Indroneel Dutt, CFO, Cleartrip
The Indian travel and tourism sector which has emerged as a key growth driver didn’t see any concrete provisions in the 6th and final budget of the current government presented by Finance Minister Piyush Goyal. While the list of 10 most important dimensions that will guide the government in Vision 2030 mentions next-gen infrastructure and digital India, the budget lacked clarity on allocations and how these could push the sector. We were hoping to see some thrust on boosting the digital and payment infrastructure for sectors with big-ticket transactions like travel and a tax relief especially for indirect taxes (levied on the tourism and hospitality sector which is considerably higher than some of the major tourist destinations globally). For a market that expected a tax reduction basis promise in 2014 to bring it down to 25% in a phased manner, the corporate direct tax rates were left untouched which comes as a disappointment. We hope these in addition to the purview of GST in accommodation space and removal of TCS (Tax collection at source) in airlines industry are points that the government will bring to its consideration in the time to come.

Aloke Bajpai, CEO & co-founder, ixigo
Tax breaks for the middle class will result in increased disposable income triggering an increase in travel and tourism spends. The proposed  Rs.1448 crore for tourism infrastructure development will propel India's growth impetus as the fastest growing travel market in the world. Allocation of these funds towards improvement of railway networks, roads and tourist destinations will help increase the economy driven by tourism.However the budget should have also addressed stronger short term initiatives to tackle the increasing air pollution problem faced by the national capital, which has had a drastic negative affect on foreign tourist inflow last year.


J.B Singh, President and CEO, InterGlobe Hotels Private Limited
The union budget has a positive ring to it and lays down the roadmap for robust growth. 100th airport opening in India, number of flyers which has doubled in the last 5 years and 27 km of roadways being built everyday (the fastest in the world) have all meant that more and more people are traveling than ever before and thus the demand for quality accommodation which is on the rise. 

Amit Kumar Singh, VP, Products & Digital Marketing, Travelyaari
Travelyaari welcomes the continued push on road connectivity, especially the rural road connectivity with budgetary allocation of INR 19,000cr under the Pradhan Mantri Gram Sadak Yojana. This continuation in infrastructure development is in right direction to push road connectivity which shall enable last mile connectivity, benefiting the remotest corner of country. The CSC initiative to create 1 lakh digital village is another welcome step which shall remove inefficiencies in market and unlock new fair markets across India through eCommerce. We look forward to partner with government on such CSC initiatives. The mobile data penetration has already enabled 3 digits growth rates even for Travelyaari on mobile platform and with these initiatives we see this to be the story for next 5 years.

Greg Moran- CO-Founder & CEO, ZoomCar
These statements by the government certainly shows that the policymakers are looking forward to a strong ecosystem driven approach to the problem statement of urban pollution. This should create an environment for long term investment on the part of the private sector.

Dinesh Kumar Kotha, Co founder & CEO, Confirmtkt 
This is truly welcome step by the government towards focus on infrastructure. On the Railways end primary focus in safety is the need of the hour but also government should focus on solving one more bigger problem of waitlist tickets. As per the Indian Railways annual Report the passengers carried is almost constant from last 2 years. So there needs to be a focus on the improving the infrastructure, add more new trains , Cut down trains on the routes where there is a low fill rate and introduce these trains in the demand routes. The budget has given focus to improving facilities and maintaining the existing trains, over announcing new trains.

 
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